Kevin Krone, ClickZ’s Featured Digital Leader for May, talks about his 25-year rise through the ranks of Southwest Airlines: from intern to the company’s second ever CMO. He delves into the difficulties of keeping up with a rapidly-changing digital world, and talks about which technological developments get him most excited for the future of marketing.
Kevin Krone started his career at Southwest Airlines as an intern a year away from finishing business school, and instantly knew that he’d found his dream job. Thus began a 25-year career that took him from setting up Southwest’s digital presence in 1995 to leading a major brand refresh as the company’s second ever CMO in 2014.
ClickZ Deputy Editor Rebecca Sentance spoke to him about keeping up with the rapid pace of digital change, how Southwest Airlines has benefited from doing things differently, and what projects he has taken up since leaving the company.
If we were to sum up the digital industry in one word, it would probably be ‘fast’.
Since the inception of the World Wide Web in 1989, the digital landscape has expanded rapidly into all areas of our lives: from a few isolated websites to a humming interconnected network of social interaction, information, misinformation, art and culture.
As desktop computers have turned into laptops, tablets and smartphones and the internet has migrated from our desks to our pockets, the pace of innovation has only gathered speed.
Few people know this better than Kevin Krone, whose twenty-five-year career at Southwest Airlines spanned nearly this entire period. Krone refers to his time at Southwest and the company’s development as “a tremendous evolution – it was so much fun to be along for the ride.”
Even in the early days of setting up Southwest.com – Southwest was the first major airline to create its own digital presence, in 1995 – the team were very conscientious about needing to be fast and agile. “We were doing it that way before people even talked about that,” says Krone. “It was a matter of survival for us.”
With that said, Southwest’s website remained more or less unchanged for a couple of years after its launch – something that would be unheard of now. “You can’t sit still that long any more,” says Krone. “Content has to be changing, it feels, by the minute.”
For this reason, Krone feels as though building a digital brand from the ground up is just as difficult now as it was more than two decades ago. In the early days of the World Wide Web, digital pioneers were fighting against a lack of familiarity; they had to convince people that the Web was safe; and the tools were fairly limited.
Now, the resources and know-how for setting up an online presence are freely available, but the field is crowded and there’s a lot more competition – and as rapidly as the digital landscape has developed, consumers’ expectations have also escalated. “There’s extremely high expectations from customers now; they have no patience for things that don’t work the right way, the fastest way.”
Since leaving Southwest Airlines, Krone has taken his expertise in being digitally agile to other companies, helping them to find ways to be more nimble and drive rapid innovation. “If you don’t move quickly, others will, and it puts you and your business at risk,” he says.
From intern to CMO
Krone knew from an early age that he wanted to work in marketing, and also to work for an airline. “I’ve always had a love for flying and aviation,” he says. “There’s just something about travelling to far-away places that was so appealing; the wonder of air travel is so appealing.”
But Krone’s love of air travel is by no means limited to being a passenger; he is also a licensed pilot. “Way back in my early years, I decided to learn to fly. It just appealed to me so much that I saved up my money, and then went out to the local airport, went to the flight school and said, ‘I want to get my pilot’s license’. I think I was 17 or 18 at the time.”
Much as Krone loves being in the air, however, he ultimately recognized that his strengths lay in the realm of marketing. “I wanted the best of both worlds – to learn to do it [fly] and have fun, but also contribute on a business level.” This was where Southwest Airlines came in, as Krone landed an internship there a year before finishing business school, and immediately knew he’d found the place that he wanted to spend his career.
“My heart was set – I knew that Southwest was the company for me,” he recalls. “It was almost like a dream come true. It’s a great company with a great corporate culture, and it makes a real investment in its people.”
One of things Krone valued most was the opportunity to gain hands-on experience with a variety of projects at all levels of the organization. “Not only was it enjoyable to work there, I was also able to learn a lot. All throughout my career I was able to join in with so many projects, including many that were above my job level. It was an incredible learning experience.” He describes being able to spend the last three years of his career as the company’s Chief Marketing Officer as “the pinnacle of a dream”.
Sadly, the more involved Krone became with his role at Southwest, the less time he was able to spend flying. “I haven’t flown as a pilot in years, but it’s still a passion of mine, and I’m hoping to get back out there before too long and do some personal flying again.”
The intersection of ‘and’
So what was it that set Southwest Airlines apart from its rivals as a brand, and as an airline? “One of the key reasons Southwest was different was that we were doing it for our customers: what they needed, what they wanted, how we could best help them. I think a lot of businesses don’t think that way – they think about what’s easiest for them to build, or what they want to create.”
This customer-centric approach led the airline to some key innovations throughout its history, such as its pioneering format for booking airplane tickets online, which allowed customers to view ticket availability by both schedule and price.
“You had the schedule down one side, and the fares across the top, kind of like a spreadsheet – that was extremely innovative at the time. Everyone else would think about whether you wanted to shop by price, or by schedule, but we decided to have both, so people could shop either way they wanted.”
Krone emphasises how critical it was for Southwest to be able to deliver on what he calls “the intersection of ‘and’” – essentially, the best of both worlds.
“You can’t fall into this trap of ‘or’s,” he says. “To do things that are world-class, you have to find the intersection of ‘and’. That’s what we decided to do with our online booking system.
“In those days, it wasn’t always easy for the customer to understand what they were committing to; everything was written in airline language, and it wasn’t particularly fast. We decided that we weren’t going to compromise by doing one thing or the other – we were going to find that intersection of ‘and’, and we were going to be fast and easy.”
Another customer-led innovation which earned Southwest a great deal of success and approbation in the long term was its decision not to charge fees for checked luggage, which was standard practice among airlines at the time. While this paid dividends in terms of customer approval and loyalty, Krone notes that it wasn’t an easy path to take, as the airline had to find other ways to make up the ‘lost’ revenue.
“There was intense pressure from lots of other constituents – not customers, obviously – but other constituents who said, ‘Hey, you’re leaving a lot of money on the table’. It felt risky, to place our bet on other revenue streams such as more business, more customers, or just different products. Investors were a little bit anxious that more money could flow to their pockets through a strategy like charging for bag fees.
“But at the end of the day, it paid off, because we had this intense loyalty from customers who appreciated the trade-off that was made on their behalf by the company.”
Engagement at the speed of light
It can be a lot more difficult, however, for businesses to stand out and impress customers in the lightning-fast digital world we now live in. Krone notes that today’s customer is much more judgemental and difficult to engage for long periods of time, a tendency which is exemplified by the way they interact with mobile apps.
“Users are so impatient. About a third of users spend a minute or less in an app; you either make it easy for them to find what they want to do, or they’re out of there. People will give you one to two attempts to get your app to work right, and then they’ll delete it. There’s this extreme impatience and intolerance for anything that’s not fast, that’s not intuitive, that doesn’t get what they need done quickly.
“Businesses aren’t thinking about it that way; they’re thinking people will explore and find the answer to what they’re trying to do – they won’t. That fast response and short attention span is something that you absolutely have to design for.”
And this situation isn’t likely to improve. Krone believes that if we’re lucky, consumers’ expectations will stay at the same level, but they’re likely to get even higher as time goes on. “Businesses are at great risk of losing customers if they don’t realize this trend and start to handle things in an efficient way.”
Is there a limit to how fast you can be and still deliver a high-quality experience? Again, Krone believes that businesses should be striving to give customers the best of both worlds, and not compromise on one thing or the other. “This is one of the trade-offs that businesses have traditionally made; they’ve always felt like it’s an ‘either-or’. And my challenge to those people is that we have to be both: we have to be fast, and we have to be accurate and good.
“It’s not an easy task, and I don’t at all mean to make it sound like it’s simple. But you have to do it, or you will lose your customers to other people who do.
“Companies have to always be thinking about what the next-best alternative is, and making sure they’re better. Early on in the airline industry, it was the phone; you could call up and say, ‘Book me a trip from point A to point B; here’s my credit card number; and fax me the receipt.’ That transaction was pretty fast. That’s what Southwest was benchmarking itself against at the time, and I think we did a pretty great job at it.
“I think the next-best alternative today is other digital options, like travel websites that are focused on trying to make the transaction as easy as possible. We’re still racing against the next-best alternative.”
Since leaving Southwest, Krone has continued trying to help businesses achieve that intersection of speed and quality. Other projects he has been involved with include joining the Board of Directors for UpLift, a fintech company which provides financing to help drive travel as a marketing tool. “It’s been really invigorating for me to learn something new, and be involved with such a successful opportunity.”
Krone has also been drawn into the world of data and analytics, in particular using aggregated data to find solutions to “thorny problems” that have plagued businesses for years.
He admits that he hasn’t been able to leave the airline industry behind altogether, and still does some work with Southwest in an advisory capacity. “Once you get the ‘kerosene virus’ – that’s a term we use in the airline industry, it’s a reference to jet fuel – it forever infects you,” he says. “Anytime I see an airplane, I stop and look up at it, no matter where I am or what it is. I definitely miss that world; it’s a part of me, and I will find a way to tie myself to it somehow.”
The future of marketing: personalization, data and artificial intelligence
What does Krone think is the most exciting trend currently taking place in the world of marketing? “It’s hard to limit it to just one,” Krone muses.
“From a ‘marketer’s dream’ standpoint, things like AR and VR are dreams come true, to be able to use techniques like that to tell your story, and make your brand even more engaging and more personal. I think those are really big and up-and-coming areas.”
He also points to personalization, fuelled by data and analytics, as a fascinating emerging trend in marketing. “It’s not that there hasn’t been data in the world, but we’re just getting to the point where it’s easy to collect and process this data, and make meaningful decisions with it. You can have interactions with customers on an almost one-to-one level.”
But more than AR, VR, personalization or data, Krone considers the biggest game-changer in the marketing industry to be artificial intelligence. “It’s going to change society, I think. All of these are big developments, but that’s the biggie, and it’s fascinating.”
Krone says he has yet to see any notable applications of AI in the airline industry just yet, but he believes the possibilities are huge, particularly when it comes to making sense of data, and in identifying and solving problems that may be beyond the ability of human beings to evaluate.
“We as humans are aware of some of the questions we need to ask ourselves about our business that are keeping us up at night. But there are probably two or three other big questions that we haven’t detected yet because we don’t have the computing power to find them. I think Artificial Intelligence can get out there and discover problems that you might not even know exist – which may even be worse than the problems keeping you up at night.”
“The airline industry is ripe for that kind of thing, because there’s so much data that goes into running an airline, and there are great insights that can be gleaned once you get more and more power to process and work through it.”
Does he think that Southwest Airlines will be at the forefront of that innovation, when it arrives?
“Southwest Airlines is very innovative and continues to look for opportunities to become even more efficient, because more efficiency means that fares will stay low,” Krone replies. “I don’t know if they’ll be the first through the door, but my guess is that they would be early adopters.”